Exhibit 99.1
SEPARATION AGREEMENT AND GENERAL RELEASE
THIS SEPARATION AGREEMENT AND GENERAL RELEASE is made and entered into this
4th day of January, 2005 by and between Xxxxxxxx X. Xxxxx (hereinafter referred
to as "Employee") and Pinnacle Airlines Inc., (hereinafter referred to as "the
Company").
WHEREAS, Employee's employment with the Company terminated on January 4,
2005. The Company and Employee desire to effect a severance of Employee's
employment with the Company on the terms and conditions set forth in this
Agreement.
NOW THEREFORE, in consideration of the mutual promises herein, the parties
agree as follows:
1. Non-Admission of Liability.
Neither this Separation Agreement and General Release nor the Company's
offer to enter into this Separation Agreement and General Release shall
in any way be construed as an admission by the Company that it has
acted wrongfully with respect to Employee or any other person, or that
Employee has any rights whatsoever against the Company, and the Company
specifically disclaims any liability to or wrongful acts against
Employee or any other person, on the part of itself, its employees or
its agents.
2. Consideration.
In full consideration and as material inducement for Employee's signing
of this Agreement and General Release, the Company will:
a. pay Employee twenty-six (26) separation payments in
the gross amount of $6483.20, less legal deductions,
paid bi-weekly, in accordance with the normal pay
policies of the Company; and
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b. provide information regarding COBRA to you by mail.
Employee will be permitted to exercise his rights
under the Consolidated Omnibus Budget Reconciliation
Act of 1986 ("COBRA"); and the Company will pay this
monthly premium for one year or until the Employee
has other health coverage.
c. pay Employee a lump sum amount equal to 32.34 hours
of accrued and unused vacation, less legal
deductions. This amount represents Employee's accrued
and unused vacation time through January 4, 2005.
d. pay Employee the lump sum amount of $54,200.00 (5,000
x $10.84)in exchange for the value of the unvested
one time Restricted Stock Grant awarded in October
2004.
e. pay Employee the remaining amount earned under the
Management Bonus Plan in 2004, less legal deductions,
no later than April 30, 2005.
Employee agrees and recognizes that his employment
relationship with The Company has been permanently and
irrevocably terminated and agrees that he will not apply for
or otherwise seek re-employment or independent contractor
status at any time with Northwest Airlink and/or Pinnacle
Airlines or any of its affiliated, related, subsidiary or
parent corporations or their successors and that such entities
have no obligation, contractual or otherwise, to hire, rehire,
or re-employ him in the future.
As an inducement for Company to consummate the acquisition of this Agreement,
including all of the goodwill associated with the consideration identified in
Paragraph Two (2), Employee agrees that, for a period of one (1) year after the
effective date of this Agreement, he will not, directly or indirectly, engage or
invest in, own, manage, operate, finance, control, or participate in the
ownership, management, operation, financing or control of, or have any financial
interest in, or acquire any right to share in the profits of, be employed by,
associated with, or in any manner connected with, lend his name or credit to, or
render services or advice to, any business whose products or activities compete
in whole or in part with Northwest Airlink and/or Pinnacle Airlines, including
but not limited to any and all Regional Airlines anywhere in the United States
or Canada; provided, however, that the Employee may purchase or otherwise
acquire up to (but not more than) one percent of any class of securities of any
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enterprise (but without otherwise participating in the activities of such
enterprise) if such securities are listed on any national or regional securities
exchange or have been registered under Section 12(g) of the Securities Exchange
Act of 1934. This paragraph may be modified and/or waived at the sole discretion
of Pinnacle's President and Chief Executive Officer provided that the Employee
consults with and obtains written approval from Pinnacle's President and Chief
Executive Officer prior to accepting employment with a business whose products
or activities compete with Northwest Airlink and/or Pinnacle Airlines. Employee
agrees that this covenant is reasonable with respect to its duration,
geographical area and scope. Employee's failure to contact and receive approval
from the President and Chief Executive Officer prior to accepting employment
with a Regional Airline shall constitute a material breach of the Agreement
entitling Northwest Airlink and/or Pinnacle Airlines to liquidated damages as
set forth herein. Employee recognizes and understands that in the event that he
violates this provision, the Company will immediately cease payment of all
separation payments and the Company will have no obligation to pay him in the
future. Employee also agrees as further consideration and inducement for this
compromise to return and/or forfeit to the Company all sums received pursuant to
this Agreement for such a breach, as liquidated and stipulated damages.
Additionally, in case of violation, Employee agrees to pay all of the Company's
attorney(s) fees and other cost associated with enforcing the provisions of this
Agreement.
3. Return of Consideration.
Employee understands that this Agreement is final and binding. Employee
agrees not to challenge its enforceability. If Employee attempts to
challenge the enforceability of this Agreement, he shall initially
tender to the Company, by certified funds delivered to the Company, all
monies and other value he receives pursuant to this Agreement, and
shall invite the Company to retain such monies and agree with him to
cancel this Agreement. In the event the Company accepts this offer, the
Company shall retain such monies and this Agreement shall be cancelled.
In the event the Company does not accept such offer, the Company shall
so notify Employee, and shall place such monies in an interest-bearing
escrow account pending resolution of the dispute as to whether this
Agreement shall be set aside and/or otherwise rendered unenforceable.
4. Cessation of Authority.
Employee understands and agrees that he is no longer authorized to
incur any expenses, obligations or liabilities, or to make any
commitments on behalf of the Company. Employee agrees to submit to the
Chief Operations Officer, on or before the Effective Date, any and all
expenses incurred by him through that date and any and all contracts or
other obligations entered into by Employee on behalf of the Company.
5. Return of Company Materials and Property.
Employee understands and agrees that he will turn over to the Company,
on or before the Effective Date, all files, memoranda, records, credit
cards and other documents, physical or personal property which he
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received from the Company and/or which he used in the course of his
employment with the Company and which are the property of the Company
or its customers. Employee agrees, represents and acknowledges that as
a result of his employment with the Company, he has had in his custody,
possessions and control proprietary documents, data, materials, files
and other similar items concerning proprietary information of the
Company, and Employee acknowledges, warrants and agrees that he has
returned all such items and any copies or extras thereof and any other
property, files or documents obtained as a result of his employment
with the Company and has held such information in trust and in strict
confidence and will continue to do so after the Effective Date.
6. No Obligation.
Employee agrees and understands that the consideration described above
in Section 2 of the Agreement is not required by the Company's policies
and procedures. The Employee further agrees and understands that he is
waiving rights and claims, including rights and claims under the Age
Discrimination in Employment Act, in exchange for consideration to
which is not already entitled. The Employee further agrees and
understands that his entitlement to receive the consideration set forth
above is conditioned upon his execution of this Separation Agreement
and General Release and compliance with the terms of this Separation
Agreement and General Release.
7. Severability.
The provisions of this Agreement are severable, and if any part of it
is found to be unenforceable, the other paragraphs shall remain fully
valid and enforceable. This Agreement shall survive the termination of
any arrangements contained herein.
8. Confidentiality; Professionalism.
Employee represents and agrees that he will keep the terms, amount,
value, and nature of consideration paid to him, and the fact of this
Separation Agreement and General Release completely confidential, and
that he will not hereafter disclose any information concerning this
Separation Agreement and General Release to anyone other than his
immediate family, attorney and/or tax preparer who will be informed of
and bound by this confidentiality clause.
Reciprocally, the Company agrees to keep this same information
confidential, and will disclose it only to those individuals within or
affiliated with the Company who have a "need to know," unless required
by law or recommended by counsel.
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Employee agrees that he will not make or issue, or procure any person,
firm or entity to make or issue, any statement in any form concerning
the Company, Employee's employment relationship or the termination of
Employee's employment relationship with the Company to any person or
entity if such statement is harmful to or disparaging of the Company,
its affiliates or any of their employees, officers, directors, agents
or representatives. Employee agrees that any violation by him of this
Section 8 will obligate him to return all consideration paid to him
under this agreement as liquidated damages, in addition to all other
legal and equitable remedies the Company might have to recover damages
and seek equitable relief against the Employee.
9. References.
The Company agrees to provide Employee with a neutral reference should
he seek new employment, giving only his dates of employment, job title
and stating that Employee resigned in order to pursue other
opportunities outside the Company. For this purpose, Employee agrees to
direct inquiries from prospective employers to the Vice President,
Human Resources attention. The Company will disclose no negative or
adverse information about Employee.
Reciprocally, Employee agrees that he will communicate nothing negative
or adverse about the Company, and will state only that he resigned to
pursue other opportunities outside the Company.
10. Complete Release.
As a material inducement to the Company to enter into this Separation
Agreement and General Release, Employee hereby irrevocably and
unconditionally releases, acquits and forever discharges the Company
and each of the Company's owners, stockholders, predecessors,
successors, assigns, agents, directors, officers, employees, former
employees, representatives, attorneys, parent companies, divisions,
subsidiaries, affiliates (and agents, directors, officers, employees,
representatives and attorneys of such parent companies, divisions,
subsidiaries and affiliates), and all persons acting by, through, under
or in concert with any of them (collectively "Releasees"), or any of
them, from any and all charges, complaints, claims, liabilities,
obligations, promises, agreements, controversies, damages, actions,
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causes of action, suits, rights, demands, costs, losses, debts, and
expenses of any nature whatsoever, known or unknown, suspected or
unsuspected, actual and consequential, specific and general, however
denominated, from the beginning of time up to and including the time of
the signing of this Agreement; whether for back pay, severance,
compensation (including deferred compensation, stock options, bonuses
or commissions), health and/or life insurance premiums, policies and/or
coverage, vacation pay, sick pay, income from any source, declaratory
or injunctive relief, compensatory or punitive damages, wages, money,
remuneration, costs, expenses, attorney's fees, retaliatory discharge
in violation of public policy, or thing of value whatsoever including,
but not limited to, rights arising out of alleged violations or
breaches of any contracts, express or implied, or any tort, or any
legal restrictions on the Company's right to terminate employees, or
any federal, state or other governmental statute, regulation, or
ordinance, including, without limitation: Title VII of the Civil Rights
Act of 1964, as amended by the Civil Rights Act of 1991, (race, color,
religion, sex, and national origin discrimination); the Americans with
Disabilities Act (disability discrimination); 42 U.S.C. ss. 1981
(discrimination); 29 U.S.C. ss. 206(d)(1) (equal pay); the Age
Discrimination in Employment Act; Executive Order 11246 (race, color,
religion, sex and national origin discrimination); Executive Order
11141 (age discrimination); Section 503 of the Rehabilitation Act of
1973 (handicap discrimination); Tennessee Human Rights Act;
Consolidated Omnibus Budget Reconciliation Act of 1985, 29 U.S.C. ss.
1161 et seq., Family & Medical Leave Act, Employee Retirement Income
Security Act of 1974 (ERISA), as each may have been amended, and those
based on wrongful discharge, breach of an implied or express contract,
promissory estoppel, intentional or negligent infliction of emotional
distress or outrage, defamation, misrepresentation, fraud, public
policy, common law, good faith and fair dealing, negligence, invasion
of privacy, interference of employment which Employee now has, owns or
holds, or claims to have, own or hold, or which Employee at any time
heretofore had, owned or held, or claimed to have, owned or held,
against each or any of the Releasees at any time up to and including
the Effective Date.
11. Litigation.
Employee agrees that neither Employee nor any person or organization on
Employee's behalf will file, or permit to be filed, any action for
legal or equitable relief, including damages and injunctive,
declaratory, monetary or other relief, including attorneys' fees and
costs, involving any matter occurring at any time or related in any way
to Employee's employment relationship or the termination of Employee's
employment relationship with the Company or involving any continuing
effects of any acts or practices that may have arisen or occurred
during Employee's employment relationship or the termination of
Employee's employment relationship with the Company.
In addition, at the Company's request you will cooperate in the
prosecution or defense of any pending or future claims or lawsuits
involving the Company, about which you have knowledge of the underlying
facts. For the time you spend working on claims or lawsuits, at the
request of the Company, after other payments under this agreement
cease, you will be reimbursed at the equivalent hourly rate at which
you were being compensated by the Company, immediately prior to your
separation.
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12. Indemnification.
As a further material inducement to the Company to enter into this
Agreement, Employee hereby agrees to indemnify and hold each and all of
the Releasees harmless from and against any and all loss, costs,
damages, or expenses, including, without limitation, attorneys' fees
incurred by Releasees, or any of them, arising out of any breach of
this Agreement by Employee or the fact that any representation made
herein by Employee was false when made.
13. Consultation with an Attorney; Twenty-One (21) Days to Decide.
The Company advises Employee to consult with an attorney prior to
executing this Agreement. Employee agrees that Employee has had the
opportunity to consult counsel if Employee chose to do so. Employee
further acknowledges that Employee has been given up to twenty-one days
to decide whether to execute this Agreement, and that Employee has had
sufficient time to read and consider this Agreement before executing
it. Employee acknowledges that he is responsible for any costs and fees
resulting from his attorney reviewing this Agreement and understands
its contents, that Employee signs this Agreement voluntarily, with a
full understanding of its significance, and intending to be bound by
its terms.
14. Right to Revoke.
Employee may revoke and cancel this Agreement at any time within seven
(7) days after Employee's execution of this Agreement by providing
notice to the Company. If the Employee does so revoke, this Agreement
will be null and void and the Company shall have no obligation to
provide the consideration specified in Section 3 above. This Agreement
shall not become effective and enforceable until after the expiration
of the seven (7) day revocation period; after such time, if there has
been no revocation, the Agreement shall be fully effective and
enforceable.
15. No Other Representation.
Employee represents and acknowledges that in executing this Agreement
Employee does not rely, and has not relied, upon any representation or
statement not set forth herein made by any of the Releasees or by any
of the Releasees' agents, representatives, or attorneys with regard to
the subject matter, basis or effect of this Agreement or otherwise.
16. Sole and Entire Agreement.
This Agreement sets forth the entire agreement between the parties
hereto, and supersedes any and all prior agreements or understandings
between the parties pertaining to the subject matter hereof.
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17. Binding Effect.
As used in this Agreement, all references to "Company" will also be
construed to refer to the Company's parent corporation, subsidiaries,
affiliates and controlling parties. This Agreement will inure to and be
binding upon the parties hereto and their respective heirs,
representatives, successors, transferees and assigns.
18. Full and Careful Consideration.
Please take this Agreement home and carefully consider all of its
provisions before signing it. You may take up to twenty-one days (21)
to decide whether you want to accept and sign this Agreement. Also, if
you sign this Agreement, you will then have an additional seven (7)
days in which to revoke your acceptance of this Agreement after you
have signed it. This Agreement will not be effective or enforceable,
nor will any consideration be paid, until after the seven (7) day
revocation period has expired. Again, you are free, and encouraged, to
discuss the contents and advisability of signing this Agreement with an
attorney of your choosing. Employee acknowledges that Employee signs
this Agreement of Employee's own free will in exchange for the
consideration to be given to Employee pursuant to Section 3 of this
Agreement, which Employee acknowledges, is adequate and satisfactory.
19. Effective Date
This Agreement and General Release will not become effective and no
consideration except for accrued and unused vacation pay pursuant to
3.c. will be paid until the eighth (8th) day following the date on
which Employee signs this Agreement and General Release.
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PLEASE READ CAREFULLY. THIS SEPARATION AGREEMENT AND GENERAL RELEASE
INCLUDES A RELEASE OF ALL KNOWN AND UNKNOWN CLAIMS.
Executed at Xxxx, Tennessee, this 4th day of January, 2005.
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/s/ Xxx X. Xxxxx
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Employee
Sworn to and subscribed
before me this 6th day
of December, 2005.
/s/ Xxxxxxx X. Xxxxxx
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NOTARY PUBLIC
My Commission Expires October 10, 2006.
[NOTARY SEAL]
PINNACLE AIRLINES, INC.
By: /s/ Xxxxx Xxxxxxxxxx
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